December 10th, 2008 
Tushar Mathur
Since many people have asked me about this in different forums, I am creating a post on how to transfer the monthly interest earned in PO Monthly Income Scheme (MIS) to an Savings Bank(SB) account.
Please note that to avail this facility you will have to open the MIS and the SB account in the same HPO(Head Post Office). As per my knowledge, this facility of auto credit is only available in Head Post Office and not in all the Post Offices. Every Pin code area has its own HPO.
When opening an MIS ( or even later if you already have an MIS account open ), give a letter to the person handling the MIS counter, stating that you want the monthly interest to be transferred to your SB account. Mention both your MIS and the SB account number in the letter.
Once this facility is activated, the interest from MIS scheme will automatically get transferred to your SB account on the date interest becomes due.
Now, no worries about going to the post office to collect the interest every month. The interest will keep getting accumulated in your SB account.
The Post Office SB account comes with facilities like Cheque book, so you can simply withdraw money from there by depositing a cheque in any of your other Savings account ( in any bank ).
A simple tip, if you don’t need the money immediately you can arrange for a scheme wherein the monthly interest gets transferred to a RD ( recurring deposit ) account via the SB account i.e.
MIS —> SB a/c —> RD
Post Office offers a 5-year PORD. If you want to transfer to an RD, you will have to give two letters:
1. One letter to transfer monthly interest from MIS to SB account.
2. Second letter to transfer the monthly installment from the SB account to the RD.
Make note of the below points:
- Interest gets transferred from MIS to SB on the date it becomes due.
- But, the installment of RD is transferred into it on the 15th of every month.
PS: A small tip, one month after you have setup this scheme ( after the interest becomes due), do visit the post office to get your pass books updated to check whether this has come into effect or not. Sometimes, even after giving letters to post office authorities, they forget to activate this facility for your accounts.
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